SC turns down stay plea on new accounting norm

New Delhi, Jul 30 | Updated: Jul 31 2007, 04:05am hrs
The Supreme Court on Monday refused to stay accounting standard AS-22 though it admitted a plea challenging this new norm issued by the Institute of Chartered Accountants of India on deferred tax liability of listed companies.

A bench headed by Justice SH Kapadia observed that the norms would continue to be in operation after solicitor general GE Vahanvati opposed the petitions saying AS-22 has come into effect in 2001.

Simplex Infrastructure, First Leasing Company of India and Association of Leasing and Financing Services Companies had sought quashing of AS-22 on the ground of it being ultra vires.

Under AS-22, a company became liable to provide for deferred tax liability on the first day the company accounted for its income in accordance with the AS-22 even when there was no certainty.